Question

Almora, a developing open economy, is experiencing an economic boom since it discovered oil reserves off its coast two years ago. Bill Hudson, an economist with the Finance Ministry of Almora, said in an interview that the oil boom has improved the average standard of living in the economy. Robin Peters is an industry analyst who does not agree with Hudson's view. In one of his recent articles in the country's leading business daily, Robin claimed that the high rate of inflation following the boom has actually weakened the expansionary impact on the economy.Which of the following, if true, will support Robin's argument?A. Employment in the country's oil industry reported an annual growth of 15 percent this year.B. The construction sector has expanded by 20 percent in the last two years.C. Almora reduced its petroleum imports this year.D. Almora's agriculture and manufacturing sectors have become less competitive in the world market.E. The government of Almora is expected to have a budget surplus of $2 billion in the current financial year.

Answer 1

Option D, Almora's agriculture and manufacturing sectors have become less competitive in the world market.

Step-by-step explanation:

The rise and peak periods of the business cycle are an economic boom. It is recognised also as a boom, a transition, and a time of development. Key economic factors are going to increase during a bubble. Gross domestic product that reflects the economic performance of a country is growing.

During the boom, there are plenty of jobs and high interest on the market for creditors. In the resulting economic downturn, people are losing their jobs and investors are losing money.

Boom-business cycles last for different times; they often vary in severity. Over-invested things will decrease in value. Investors are losing their money, customers are cutting spending and companies are cutting jobs. Loans get tougher as lenders can not meet their loan payments for boom time.